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by Patrick Cleary, Bowman & Brooke, LLP

News articles about self-driving vehicles are omnipresent as 2017 begins, suggesting that humans will soon no longer need to worry about driving. If technological and infrastructure advances occur at their predicted pace, automated vehicle technologies will assist, supplant and possibly replace human drivers over the next twenty years. This paradigm shift creates the real promise for dramatically reduced motor vehicle accidents and associated fatalities, injuries and damages.

But it also creates the real possibility that the plaintiffs' bar will shift their focus from assigning fault to the driver of accident vehicles to the manufacturers of vehicles involved in accidents. In effect, the plaintiffs' bar will argue that the manufacturer of any vehicle equipped with automated driving technologies is liable when said vehicle has an accident. For example, while the National Highway Traffic Safety Administration ("NHTSA") concluded last week that Tesla's Autopilot system did not have a safety-related defect that contributed to a fatal 2016 accident in Florida, it is not a stretch to think that the plaintiffs' bar would make a different argument that vehicles with autopilot systems are "strictly" responsible.(1)

We expect the plaintiffs' bar to argue that the introduction of automated driving technologies, regardless of form or function, mean that the vehicle itself has the ultimate control over what happens on the roadway. To put it simply, the North Carolina plaintiffs' bar will argue the doctrine of last clear chance will shift from the negligent driver to the motor vehicle manufacturer, opening up new avenues of recovery for injured drivers from their vehicle manufacturer.

If the plaintiffs' bar prevails, it would be a dramatic shift in North Carolina product liability law, creating a quasi-strict liability regime and a repudiation of contributory negligence outside of legislative enactment. But this argument presents a false dichotomy between automated and non-automated vehicles and ignores well-established doctrines of personal responsibility inherent in North Carolina law.

This article clarifies the development and introduction of automated vehicle technologies and then evaluates these technologies within the context of North Carolina product liability law. As a defense bar, we have the obligation to rebut plaintiffs' arguments, showing that automated vehicle technologies do not replace the duty of a driver nor do they supplant North Carolina product liability law.

Development of Automated Vehicle Technologies

Motor vehicles have not and will not immediately shift from completely human controlled to fully autonomous. Instead, motor vehicles will transition from fully human controlled to human controlled but machine assisted, to machine controlled in certain locations then possibly fully automated. An example of this shift was discussed by Dr. Gill Pratt, Toyota Research Institute CEO at the January 2017 Consumer Electronics Show. (2)

For a more detailed description of this transition, in September 2016, NHTSA released the Federal Automated Vehicles Policy. (3)  In the Policy, NHTSA differentiates vehicles on "who does what, when" by adopting the SAE Levels of Automation. There are six distinct levels of automation:

At SAE Level 0, the human driver does everything;

At SAE Level 1, an automated system on the vehicle can sometimes assist the human driver conduct some parts of the driving task (an example is vehicle equipped with cruise control);

At SAE Level 2, an automated system on the vehicle can actually conduct some parts of the driving task, while the human continues to monitor the driving environment and performs the rest of the driving task (an example is dynamic cruise control or some types of electronic stability control);

At SAE Level 3, an automated system can both actually conduct some parts of the driving task and monitor the driving environment in some instances, but the human driver must be ready to take back control when the automated system requests (the Tesla auto-pilot system is at this level);

At SAE Level 4, an automated system can conduct the driving task and monitor the driving environment, and the human need not take back control, but the automated system can operate only in certain environments and under certain conditions (vehicles at Level 4 could control themselves on dedicated roadways); and

At SAE Level 5, the automated system can perform all driving tasks, under all conditions that a human driver could perform them.

There are no commercially available levels for sale at SAE Levels 4 or 5. Indeed, the vast majority of vehicles for sale today are SAE Level 1 or 2 vehicles; vehicle automated driving technologies simply assist the driver. And these technologies have been installed on vehicles for an extended period of time, helping drivers safely control their vehicle on the road. What this means is nothing new. Human drivers have the obligation and responsibility to monitor and control the vehicle – there are no vehicles currently available where the driver can abrogate this responsibility to the vehicle itself.

North Carolina Product Liability Law and Automated Vehicles

North Carolina product liability statutes and case law confirm tried and true principles: there is no strict liability in tort, manufacturers must exercise reasonable care in designing and manufacturing their products, product users must exercise reasonable care and contributory negligence is a complete defense to product liability causes of action. N.C. Gen. Stat. §99B-1.1 (“There shall be no strict liability in tort in product liability actions.”); Smith v. Fiber Controls Corp., 300 N.C. 669, 678, 268 S.E.2d 504, 509–10 (1980); N.C. Gen. Stat. §99B-4(3). See also Nicholson v. Am. Safety Util. Corp., 346 N.C. 767, 773, 488 S.E.2d 240, 244 (1997) (noting that the statute “does not create a different rule for products liability actions; it clarifies the common law contributory negligence standard with respect to these actions.”); These tried and true principles provide clear guidance to manufacturers, litigants and the courts when motor vehicle product liability actions occur.

In particular, contributory negligence limits the ability of injured drivers to recover from a vehicle manufacturer. Unlike in many other jurisdictions, injured North Carolina drivers cannot use the doctrine of strict liability to seek recovery from their vehicle manufacturer. These statutory limitations on recovery are consistent with North Carolina tort and product liability law, and ensure that recovery does not occur when a driver fails to exercise reasonable care.

As discussed above, the current introduction of automated vehicle technologies does not replace the need for a driver's reasonable care, but assist the driver in exercising that reasonable care. Any other argument misrepresents North Carolina law and the current status of automated vehicle technologies.

Conclusion

North Carolina's tried and true doctrines of contributory negligence, personal responsibility and reasonable care do not change because of autonomous vehicles and driver assistance technologies. Motor vehicle drivers have the firmly established responsibility to control their vehicles with reasonable care. While automated vehicle technologies will prevent accidents and reduce harm, they do not excuse or replace a driver's non-delegable duty to control their vehicle. The defense bar has an obligation to challenge plaintiffs' attempts to circumvent these tried and true doctrines in motor vehicle accident litigation involving vehicles equipped with automated vehicle technologies.

Endnotes:

(1) https://static.nhtsa.gov/odi/inv/2016/INCLA-PE16007-7876.PDF. Of note, NHTSA classified the Tesla Autopilot as "the Autopilot system is an Advanced Driver Assistance System (ADAS) that requires the continual and full attention of the driver to monitor the traffic environment and be prepared to take action to avoid crashes."

(2) http://corporatenews.pressroom.toyota.com/releases/2017-ces-press-conference-pratt.htm

(3) https://www.nhtsa.gov/technology-innovation/automated-vehicles

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by Bradley C. Friesen, Bell Davis & Pitt

In 2016, the North Carolina Court of Appeals issued three opinions that clarify aspects of the attorney-client privilege. They provide helpful refreshers on the basics of attorney-client privilege, as well as guidelines and warnings for how to maintain the privilege during litigation. Additionally, the Federal District Court for the Western District published an opinion about privilege in the context of real estate transactions, which seems to conflict with the view of many real estate practitioners.

The starting point for discussion of these cases is a review of the elements of attorney-client privilege. The privilege protects attorney-client communications from disclosure, thereby promoting full and frank communications between attorney and client. It arises under the following circumstances: (1) the relation of attorney and client existed at the time the communication was made, (2) the communication was made in confidence, (3) the communication relates to a matter about which the attorney is being professionally consulted, (4) the communication was made in the course of giving or seeking legal advice for a proper purpose, although litigation need not be contemplated, and (5) the privilege has not been waived.(1)

Friday Investments v. Bally Total Fitness: No Joint Defense or Common Interest Protection for Indemnity Relationship Arising from Asset Sale Agreement.

In Friday Investments, LLC v. Bally Total Fitness of the Mid-Atlantic, Inc.,(2) the Court of Appeals held that communications between indemnitee and indemnitor did not qualify for privilege under the joint defense or common interest doctrine. This doctrine extends the attorney-client privilege to persons outside of the attorney-client relationship when they “(1) share a common interest; (2) agree to exchange information for the purpose of facilitating legal representation of the parties; and (3) the information must otherwise be confidential.”(3)

This case arose from a lawsuit for back rent under a commercial lease. Friday Investments was the landlord and Bally was the tenant. Before the claims accrued, Bally sold its assets, including its rights under the lease. The asset purchase agreement included the following indemnification provision:

“[Purchaser agrees to] defend, indemnify, and hold [Bally] … harmless of, from and against any [l]osses incurred … on account of or relating to … any Assumed Liabilities, including those arising from or under the [lease] after closing.”

After Friday Investments filed suit, the purchaser agreed to provide a defense for Bally under the indemnification provision.

The plaintiff took the deposition of Bally’s general counsel. During the deposition, the plaintiff’s counsel asked Bally’s general counsel to describe “all of the conversations” after the lawsuit was filed that he personally had with the purchaser—i.e., the entity providing the defense and indemnity for Bally. Attorney-client privilege was asserted. The trial court later granted the plaintiff’s motion to compel the answers, and denied Bally’s motion for a protective order. Bally appealed.

The Court of Appeals held that the joint defense or common interest extension of the attorney-client privilege was limited to relationships formed primarily for the purpose of indemnification, like an insurance contract, or for coordination among parties in common litigation.(4) The Court held that the asset purchase agreement in this case arose out of a business relationship, and that the indemnity provision was ancillary to the business purposes of the parties. (5) The Court further distinguished the indemnity provision at issue from an insurance contract by noting that it did not allow the indemnitor any right to settle or effect the outcome of the litigation, further emphasizing its business purpose.

This rationale begs an important question: when would an indemnification provision in an asset purchase agreement be invoked, except in the “non-business” context of litigation? Additionally, while the indemnitor in this case lacked a contractual right to settle the litigation, it was paying for the defense and any ultimate judgment, which would seem to give it a stake in the outcome sufficient to warrant the right to be informed about the shape and strategy for the litigation without having to reveal it to the plaintiff. The North Carolina Supreme Court granted discretionary review for this case on December 8, 2016, so further clarification about this issue is likely.

Berens v. Berens: A Litigant’s Friend became her Agent to Help with Litigation, thereby Preserving Confidentiality and Privilege.

Berens v. Berens (6) is a family law case in which the plaintiff-husband subpoenaed communications between the defendant-wife and her friend, who was helping her with the case, as well as communications between the wife’s attorney and the friend. Ordinarily, the presence of a non-client or non-attorney during a communication destroys the confidentiality of the communication, and therefore, the privilege. However, the wife asserted that her friend, although not the wife’s attorney, was her “agent and personal advisor to specifically assist her in this litigation.”(7)

At the beginning of the friend’s involvement, and before any privilege dispute arose, the defendant and her friend formalized this principal-agent relationship in a written “Confidentiality Agreement and Acknowledgement of Receipt of Privileged Information.” The agreement provided (1) express authority for the friend to act as agent for the wife (2) subject to the wife’s control.(8) The agreement also provided that the friend-agent would “limit her communications concerning the Client’s litigation … to Client and Client’s attorneys and they [sic] will have no communication with anyone including, but not limited to Wife’s experts, accountants, consultants or attorneys or other advisors and consultants unless Client’s attorneys are present.”(9)

The trial court found that the communications in the presence of the wife’s friend were not privileged because there is “no good friend exception” to the strict elements of attorney-client privilege. However, the Court of Appeals, found that the agency relationship was sufficient to keep the communications within the attorney-client circle. The Court held that being a good friend and being a litigant’s agent are not mutually-exclusive roles.(10) In this case, the record before the trial court and the Court of Appeals contained the friend’s affidavit, describing the agency relationship, as well as a copy of the written agency agreement. The Court of Appeals found these items to be sufficient to establish a client-agent relationship sufficient to preserve the attorney-client privilege.

Sessions v. Sloane: A Checklist for How to Preserve and Present Privilege Disputes.

In Sessions v. Sloane,(11) a group of business partners wanted to protect their internal communications from discovery by a creditor. Sloane and his partners won a $50 Million contract with the Royal Canadian Mounted Police to provide three cruise ships to house security forces during the 2010 Winter Olympics in Vancouver.

A key reason they won the contract was a letter of credit for 10% of the $50 Million bid, which was provided at the last minute by the plaintiff, John Sessions. The defendants agreed to pay plaintiff a fee of $5 Million out of the proceeds of the contract. The proceeds ended up in the trust account for the defendants’ attorney after litigation with the Canadian government. Plaintiff caught wind of a plan by defendants to avoid paying his $5 Million fee, and he sued the defendants and obtained an attachment of the funds in their attorney’s trust account.

During discovery, in response to a commonly-propounded discovery request for all documents “concerning” the plaintiff, the defendants asserted attorney-client privilege and work product protection. They produced a privilege log identifying some emails among the defendants—no attorneys—from the time period when the defendants were negotiating the terms of the letter of credit agreement with the plaintiff. The plaintiff moved to compel these communications, along with the To, From, CC, BCC, and Subject fields for other emails on the privilege log.

In response, one of the defendants submitted an affidavit stating that the defendants had hired counsel and planned from day one to deny the enforceability of the agreement with the plaintiff, and therefore, they involved an attorney and anticipated litigation from the beginning. The defendants did not provide the materials at issue to the trial court for in camera review. The parties disputed whether those materials were offered for in camera inspection, but unfortunately, the court reporter present in the court room did not “take down” the proceedings. (PRACTICE POINTER: Expressly request that the hearing be taken down by the court reporter). The trial court ordered the non-attorney communications to be produced, along with the email header information, including email subject lines, for the emails on the privilege log.

On appeal, the Court of Appeals addressed numerous aspects of privilege, which can be summarized in the following checklist about how to preserve and present privilege disputes:

• The party asserting privilege has the burden to establish it. Providing a privilege log with only the date, sender, and recipient information, along with a claim of privilege and the basis, “email seeking or containing legal advice,” without providing the documents for in camera review, does not meet the burden because the court lacks sufficient information to evaluate the claim of privilege. (12)
• Orally offering to allow the judge to review the material at issue is not the equivalent of actually submitting the material for review.(13)
• If the material was not submitted to the trial court, it will not be reviewed by the Court of Appeals. (14)
• “The better practice in privilege controversies would be to submit a motion, affidavit, privilege log, request for findings of fact and in camera review together with a sealed record of the documents to be reviewed.”(15)
• In a matter of first impression, the Court of Appeals held that email subject lines may contain privileged material, but the subject line must meet the elements of attorney-client privilege, and should be submitted for in camera review. “Email containing legal advice” is not a sufficient description to establish privilege.(16)

In re: Grand Jury Subpoena No. 2013R00691-009: Communications Made to Effectuate Real Estate Transaction are Not Privileged.

Finally, Judge Whitney issued an opinion in Grand Jury Subpoena No. 2013R00691-009.(17)  In this matter, a law firm was subpoenaed to produce “all documents, records, or files maintained by firm regarding the closing of real estate transactions” between its client and certain parties. The law firm objected to producing confidential communications on the grounds of attorney-client privilege. Judge Whitney issued a published opinion granting the government’s motion to compel, stating that “[b]ecause of the frequent recurrence of objections … the Court now memorializes its oral ruling with this published opinion.”(18)

The Court ordered the law firm to produce its communications with its client, stating that

First, the subpoenaed documents are real estate closing files. Second, Movant is admittedly in a position of dual representation. … [E]ither [reason] independently, would suffice to determine that attorney-client privilege does not protect the subpoenaed communications ….(19)

Perhaps alarmingly, the Court further stated that

A client communication made for the purpose of effectuating a real estate closing inherently must be made in contemplation of ultimate public disclosure. Therefore, no intention of confidentiality, and thus no privilege exists.(20)

This decision and rationale conflicts with the way many real estate practitioners view their communications with their clients. While some communications contain information contemplated to be included in the public record, other communications—including details related to negotiations, loan terms, and other matters—are intended to remain confidential. Real estate practitioners should be aware of this published decision.

Conclusion.

The mechanics of attorney-client privilege are often an afterthought during litigation. However, it is important to counsel our clients about privilege at the beginning of the representation so that it is not waived, as well as to avoid creating discoverable non-privileged material in the first place. Finally, remember to create an adequate record for the court to review so that privilege disputes are not waived.

Endnotes:

(1) Sessions v. Sloane, et al., 789S.E.2d 844 (N.C. App. 2016)
(2) Friday Investments, LLC v. Bally Total Fitness of the Mid-Atl., Inc., 788 S.E.2d 170 (N.C. App. 2016), review allowed, 793 S.E.2nd 685 (N.C. 2016)
(3) Id., 788 S.E.2d at 177.
(4) Id., at 178.
(5) Id.
(6) Berens v. Berens, 785 S.E.2d 733 (N.C. App. 2016)
(7) Id., at 739.
(8) Id., at 736.
(9) Id., at 737.
(10) Id., at 741.
(11) Sessions v. Sloane, et al., 789 S.E.2d 844 (N.C. App. 2016)
(12) Id., at 856-7.
(13) Id.
(14) Id., at 854.
(15) Id.
(16) Id., at 856.
(17) In re: Grand Jury Subpoena No. 2013R00691-009, No. 316MC00079FDWDCK, 2016 WL 4385874 (W.D.N.C. Aug. 16, 2016).
(18) Id., at 1.
(19) Id., at 5.
(20) Id.

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by Shannon J. Colangelo, Queen City Court Reporting

In the past decade, the practice of insurance companies contracting for services has changed the court reporting industry, but for better or worse? Who is this practice benefiting, the local court reporting firm or the insurance industry? This practice has been the subject of much debate over the years as to whether these contracts bias the court reporting firms providing the service. In February of this year, California became the latest state to pass a law imposing disclosure requirements similar to those in North Carolina, while over half the states in the U.S. prohibit these contracts completely.

N.C. Gen. Stat. § 1A-28(c)(4) addresses the rise in the use of exclusive or preferential contracts between providers of deposition services being financed by insurance companies, in efforts to ensure fairness and prevent cost-shifting. Such arrangements, while frustrating for small court reporting firms and counsel on opposite sides of such litigation, have thus far not been prohibited in North Carolina. The vexation created by these contracts is felt predominantly by attorneys paying for “outrageous” copies, as evidenced in a recent suit, Crystal Danielson vs. Veritext Corporate Services, Inc., filed by attorney Lamar Armstrong. Although the Court ruled against Mr. Armstrong’s client in this case, his plight is felt throughout the industry. Judge Robinson noted, “Nor does Danielson allege that she, or her counsel, made any efforts prior to the deposition to determine who would be serving as the certified verbatim reporter at the deposition or how much a copy of the deposition would cost.” As an aside, most court reporting firms cannot tell you how much a transcript is going to cost prior to the deposition, as prices are dictated by page count. The best they could have done was disclose their copy page rate.

N.C.G.S. 1A-28(c)(4) also requires “the party desiring to take the deposition under a stipulation shall disclose the disqualification in writing in a Rule 30(b) notice of deposition and shall inform all parties to the litigation on the record of the existence of the disqualification under this rule and of the proposed stipulation waiving the disqualification. Any party opposing the proposed stipulation as provided in the notice of deposition shall give timely written notice of his or her opposition to all parties.”

This business shift allowing insurance clients to dictate which reporting firm to hire has hurt independent reporters and local reporting firms and benefitted national reporting firms and the insurance industry. National reporting firms, most of which are not located in North Carolina and do not benefit our economy in the same way local reporting firms do, contract with insurance companies to provide lower original rates to their client and charge higher than average page rates to the copy attorneys, while paying lower than average page rates to the court reporters who provide the actual service to the client, all in efforts to cover their exorbitant overhead. This shift in business has affected closure of many small firms in recent years due to their clients being herded to the national firms by insurance litigation. Small court reporting firms across our state, as well as throughout the U.S., are still trying to survive this industry shift. In an if-you-can’t-beat-them-join-them mentality, some local reporting firms have petitioned these national agencies, requesting to be placed on their list of approved firms, if only to handle the depositions of their own clients, most times being thwarted in the attempt unless the attorney goes to battle with the insurance company on their behalf.

In a May 2016 Lawyers Weekly article, Lawyer challenges court reporters on ‘outrageous’ copy charges, Phillip Bantz interviewed Mr. Armstrong, the attorney who filed the suit against Veritext. The article quotes Armstrong to have “believed that court reporters are using copy charges as an ‘extra profit center’ but he said he’s been told that reporters have to make money off the copies based on how they price the originals...the answer is to set your originals at whatever cost you need to generate the profits you want.” In theory, this is a plausible answer, but would necessitate an industry-wide pricing model change. If one agency raised the prices of original transcripts to cover the expenses that copy sales now cover, that agency would not be competitively priced within the industry and would soon find themselves out of business. Another way to keep costs down is to use a local firm with a smaller overhead and plan the deposition with enough time to receive transcripts at standard, not expedited, page rates.

This problem has been ongoing for more than a decade. Consumer Watchdog discussed the issue in 1999. One attorney they quoted had complaints that mirror the concerns of court reporters across the nation, “When a client learns that the court-reporting firm is financially tethered to the insurance company, he feels that maybe he's not getting the transcript he deserves,” Says Gallen. “One thing we could always count on in the past was the integrity of the court reporter. I could always make that assurance to my client. But now I can't vouch for something I don't know.” They also point out that “many defense lawyers hate being told which court reporter they can use for a particular case. They'd rather pick the best one for the job.” The same holds true today.

When asked, “How does contracting affect impartiality? Aren’t ethical codes enough?”, the National Court Reporting Association’s answer is that “Any arrangement that threatens the impartiality of court reporters or merely threatens the appearance of impartiality will lead to a breakdown of our justice system. What if the judge in a case of yours was being paid by your opponent in the litigation? Would their oath to be impartial be enough for you? If you lost, would you feel as though you got a fair shake? It is our faith in the impartiality of the judicial system that is the very basis of our Rule of Law and ordered government, and this foundation erodes when the antagonists in litigation--the parties--start directly paying the bills of the allegedly impartial.”

The national agencies keep growing year after year and acquiring more smaller firms in every state and, left unchecked, will eliminate the small reporting firms all together in not too many years. If you’re paying too much for copies now, beware. The monopoly that is growing certainly will not keep prices down in the future.

About the Author: Shannon Colangelo has been a court reporter for 10 years, partnering with three colleagues in March, 2015, to form Queen City Court Reporting. She spent the 20 years prior as an executive assistant and is a Gulf War veteran, U.S. Air Force. Queen City Court Reporting, based in Charlotte, with over 50 years combined experience, serves primarily North and South Carolina, as well as the Southeastern U.S. We pride ourselves on our professionalism, accuracy, and timeliness in every job we take, striving to get to know our clients so we can tailor each job to fit their individual needs.

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by Niki T. Ingram, Marshall Dennehey Warner Coleman & Goggin

"Black lives matter," "equality for women," and "diversity and inclusion" are all phrases that are thrown about in today's world. These phrases mean different things to different people, and one can argue that they refer to moral conclusions that some individual or groups espouse. They are generally not phrases that come to mind when talking to the insurance industry, but perhaps they need to be. It is important for insurance carriers, and those who represent them, to realize that the world is a very diverse place and that the appreciation of these differences can be critical when evaluating cases.

Proper reserving is one of the most important aspects of working in the insurance industry. Carriers set their premiums based upon algorithms used by underwriters when issuing policies. Those algorithms take into account the likelihood of a claim occurring. Insurance companies are obviously in the business of making money when writing insurance, and, from the inception of a claim until its conclusion, it is critical that the reserves are adequate. Once a claim does occur, the initial reserve is set by the insurance adjuster. The setting of the reserves is based upon the most accurate assessment of the case that is possible. Reserves, however, are fluid and should change as the case evolves. Should the case go into litigation, the attorney representing the defendant then becomes involved in the valuation process. It is essential that the adjuster and the defense attorney be as accurate as possible when evaluating cases and that all factors involved in the case are appropriately assessed. One way to assure that this happens is to make certain that neither the claims professional nor the defense attorney allows his or her unconscious biases to impact the valuation of the case.

Unconscious biases are those prejudices we all have that impact our belief structure about other groups. These biases may be based on race, gender, ethnicity, age, disability status, personality type or some other factor. They don't necessarily all exist together, but we all manifest them in some way or another. In the context of this article, the biases that are being discussed are those of racial prejudice.

Several years ago, I had a case where I was asked to provide a settlement analysis for my client, which was a large third-party administrator. I went through the standard process of evaluating the case and considered the age of the plaintiff and her life expectancy, as well as the extent of her injury, the permanency of that injury, the cost of her medical treatment, what future treatment she would need, her ability to work, her loss of earnings and her level of pain and suffering. My settlement recommendation was neither high, nor low, from my perspective. However, the client dismissed my analysis immediately. What was interesting was that the dismissal was done using terms that could be classified as "buzz phrases," such as "people like her don't need that kind of money" and "she's just not a quality human being. I don't want her to get a large settlement. Let's make her sweat it out." What was the plaintiff like? Where did she live? What made her not a quality human being? I'm not sure of all of the answers to these questions, but she was a middle-aged African-American woman who lived in a working class neighborhood that was primarily African-American and Latino. She had an Associate's degree and had been working for a number of years when she sustained her injury. There was nothing to outwardly suggest that she was not "a quality human being." The claims adjuster refused to settle the case, and it dragged on for another year.

The result of the failure to settle this case early was that by the time it did settle, my client paid $50,000 more than the original settlement recommendation. This case has always resonated with me because it is emblematic of the many reasons why diversity and inclusion should be important to the insurance industry. Was the adjuster in this case a racist? Probably not. Did his unconscious biases about African-Americans impact the value that he placed on the case? Probably. There are many studies that show that affinity biases exist. These biases are those which make us inclined to like or value individuals who are most like ourselves. In recent years, many studies have been conducted on unconscious biases, and one study done in 2014 showed that, even when people believe that prejudice and discrimination are wrong, they still harbor these biases. (Henneman, 2014). There are a myriad of unconscious biases that exist, and it is important for the defense industry to understand that hiring and retaining diverse personnel helps to reduce the biases of others in the office and that this, along with formalizing training about issues of diversity, leads to increased understanding and respect for individuals who are different than the evaluator.

The initial response from the insurance industry and the defense bar about a case such as my example above may be that this was an individual instance and there was no demonstrated racism. Perhaps a more thoughtful and realistic way to deal with the issues posed might be to focus on the fact that the case could have settled more quickly and more cheaply had the adjuster been able to recognize and appreciate the value of a non-white life. Even if minorities are not well represented in either the insurance industry or the defense bar, there can be training conducted that helps individuals to understand what their unconscious biases are and how to overcome them or compensate for them. While there is certainly a moral argument that the hiring and retention of minorities is important for the defense industry, there is also an economic incentive to implement and strengthen diversity programs and practices.

All cases need to be evaluated as accurately as possible. This starts with the first-line adjuster. These adjusters need to recognize and overcome any inherent biases they have. As a case proceeds into the litigation process, it is incumbent upon defense counsel to do the same. The recognition that unconscious biases may play into analysis will not only help improve accuracies in setting reserves and settlements, but it is the beginning of change for the industry as a whole.

About the Author: Niki T. Ingram is a Shareholder, Director of the Workers' Compensation Department, and a member of the Board of Directors at Marshall Dennehey Warner Coleman & Goggin. 

This article is re-printed with permission from DRI’s Diversity Insider Newsletter, May 6, 2016 issue.

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by Erin M. Young, Hall Booth Smith, PC

A recent Order and Opinion from the North Carolina Business Court establishes that corporate in-house counsel in this state can no longer rely on the mere fact that they are attorneys as a shield from becoming testifying witnesses in litigation. The Court determined that, under the circumstances, a blanket order prohibiting plaintiff from deposing in-house counsel was not justified and the deposition could proceed. In the November 2, 2016 Order and Opinion, Chief Business Court Judge James Gale denied a Motion for Protective Order filed by Acuity Healthcare Holdings, Inc. and Acuity Healthcare, L.P. ("Acuity") in response to plaintiff's request to depose their general counsel and vice president of compliance and risk management.

Background

Plaintiff, Carmita Edison, worked as a respiratory therapist at Mercy Restorative Hospital ("Mercy"), a long-term acute care hospital in Charlotte. Acuity and Mercy jointly employed the plaintiff. Plaintiff alleges that Acuity and Mercy wrongfully terminated her after she filed a complaint with the North Carolina Respiratory care Board regarding poor patient care, incorrect ventilator settings, false documentation, and management failures.

Plaintiff's attorney requested to depose Acuity's general counsel. Acuity, in its Motion for Protective Order, stated that their general counsel provided "general legal advice and counsel to [Acuity] . . . regarding legal compliance and management of legal risk." Acuity's 30(b)(6) designee also identified the general counsel as the person capable of answering questions on topics relevant to the dispute about which the designee had no knowledge.

Plaintiff then served a notice of deposition on Acuity's general counsel to which Acuity responded with a Motion for Protective Order.

Legal Analysis

The Business Court adopted the "Shelton" rule set forth in the Eighth Circuit decision of Shelton v. American Motors Corp., 805 F.2d 1323 (8th Cir.1986 ). A party may depose corporate in-house counsel if they are able to demonstrate that "(1) no other means exist to obtain the information than to depose opposing counsel; (2) the information sought is relevant and nonprivileged; and (3) the information is crucial to the preparation of the case."

In its discretion, the Business Court found that under the Shelton analysis, Acuity's general counsel could be deposed because the deposition was not targeted solely at eliciting information relating to Acuity's litigation strategy, and the deposition would not necessarily result in undue burden or expense. The Court further determined that there was no evidence that counsel had been substantially involved with overseeing the litigation. Additionally, the 30(b)(6) designee identified in-house counsel as the person who could best speak to certain clinical care standards and to consistency among Acuity's hospitals.

Holding

Where defendant's general counsel also served as one of its vice presidents who may have unprivileged knowledge relevant to the case, she may be deposed. The Business Court stated that a blanket order prohibiting general counsel's testimony was unjustified; that Acuity could assert the attorney-client privilege on a question-by-question or subject-by-subject basis.

Future Implications

Neither North Carolina's appellate courts nor the Fourth Circuit have expressly adopted the Shelton rule. However, federal district courts in North Carolina have applied the rule in some cases. The Business Court's adoption of the rule certainly has persuasive implications for other trial courts considering this inquiry. The trend now seems to be that court's will not issue a blanket prohibition on the in-house deposition but will entertain a motion to limit the scope of the deposition.

Though the ruling in this case sounds ominous, you must remember that Acuity's general counsel served in dual capacities – both as general counsel and as vice president of the company's compliance and risk management department. In that regard, she possessed non-privileged, relevant, factual information necessitating her participation in the litigation as a fact witness.

To reduce the possibility of general counsel becoming a deponent, corporations and their in-house counsel can take some proactive measures to reduce the chances of being deposed or to limit the scope of the deposition.

• Do not allow the in-house attorney to act like a fact witness. For example, corporate counsel should avoid signing affidavits or interrogatories as the corporate representative if possible. Participation in factual discovery erodes the line between counsel and fact witness.
• Delineate those written communications that are made solely for the purpose of giving legal advice. Routine business communications do not become privileged solely because they are sent to or copied to in-house counsel. Clearly, identify all written communications seeking or providing legal advice as "confidential" and/or subject to the attorney-client privilege in the event of a request for production or in camera review. Also, only disseminate communications with legal advice to those who have a legitimate "need to know." Have non-legal employees identify communications to in-house counsel as a "request for legal advice."
• If general counsel serves a dual role, avoid discussing legal and business topics in the same communication or forum. Where the in-house counsel wears both a legal hat and a business hat, that automatically increases the likelihood that he/she possesses non-privileged information. Thus, the dual roles should be clearly delineated as much as possible to protect the attorney-client privilege.
  
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by Queen City Court Reporting

by Luke Dalton

Elements of basic technology were introduced into our vehicles decades ago. Over time, the adapting and interfacing of technological modalities have been slowly, even incipiently, integrated into our vehicles.

Today, many of our vehicles utilize both short-range and long-range connectivity through wireless interfaces to support features such as tire pressure monitoring, telematics and Smart Key keyless entry/ignition start. These interfaces include Bluetooth, Wi-Fi, radio frequency, Global System for Mobile Communications/Code Division Multiple Access and Universal Mobile Telecommunications System.

For some time, our vehicles have also used several self-driving technologies, including collision avoidance, drifting warning, blind-spot detectors, enhanced cruise control and self-parking. Still, not many years ago, the thought of driverless vehicles seemed like a remote and distant possibility. However, the technology that will be utilized in our vehicles has progressed rapidly, more so than many in the legal community previously thought possible.

From recent news, society is learning more about the future of technology in our vehicles, and the resulting legal issues that may arise. In late 2015, Tesla released a self-driving feature called Autopilot to customers in a software update. Through outlets such as The Wall Street Journal, we are now learning about Uber’s plans to utilize self-driving vehicles as soon as this month to transport passengers around Pittsburgh.

The Federal Government seems to be encouraging the development of self-driving automated/autonomous vehicles. The U.S. Department of Transportation John A. Volpe National Transportation Systems Center prepared a preliminary report in March 2016 identifying instances where existing Federal Motor Vehicle Safety Standards may impede the introduction of automated/autonomous vehicles. More recently, during his remarks at the 2016 Automated Vehicles Symposium, Mark Rosekind, Administrator of the National Highway Traffic Safety Administration (NHTSA), outlined many benefits of technology in our vehicles. He spoke of a future “where vehicle automation and vehicle connectivity could cut roadway fatalities dramatically.” Further, the technology will assist disabled and elderly people in reclaiming the independence and freedom allowed by a personal vehicle.

However, as we have also seen in recent news, there are potential dangers associated with connected and automated/autonomous vehicles. For example, the U.S. Government Accountability Office (GAO) has noted that researchers found our vehicles’ wireless interfaces—if not properly secured—may be exploited to gain access to in-vehicle networks, and to take control of brakes and other safety-critical functions. After widespread news coverage of an accident in Florida involving a Tesla Model S using the Autopilot feature, we have also seen that automated/autonomous vehicles will be involved in catastrophic events. Governmental agencies and members of the legal community have been working to keep pace with technological innovation in order to anticipate and address these dangers, while still embracing the use of technology in our vehicles.

In 2014, the NHTSA issued a summary of cybersecurity best practices to address the growing cybersecurity risks associated with vehicles equipped with advanced electronic control systems. The SPY Car Act of 2015 was introduced in the U.S. Senate, which would have directed the NHTSA to issue motor vehicle cybersecurity regulations. Some have called for governmental agencies to take further actions. The GAO recently called for the Department of Transportation to define its role in responding to vehicle cyber-attacks.

This year the NHTSA announced its belief that it retains authority over automated vehicle technologies, systems, equipment, software and after-market software updates, such as Tesla’s Autopilot feature, as “motor vehicle equipment.” The NHTSA noted that a defect in a vehicle’s hardware, software, and other electronic systems “may be considered a defect of the motor vehicle itself,” and that unique safety risks are presented by software installed in or on a vehicle.

According to the NHTSA, a software failure or safety-risk constitutes a defect when the software has manifested a safety-related performance failure, or otherwise presents an unreasonable risk to safety. The NHTSA noted:

To avoid violating Safety Act requirements and standards, manufacturers of emerging technology and the motor vehicles on which such technology is installed are strongly encouraged to take steps to proactively identify and resolve safety concerns before their products are available for use on public roadways.

Issues caused by connected and automated/autonomous vehicles will likely raise novel issues under current state laws. According to the National Conference of State Legislatures, as of 2015, sixteen states introduced legislation related to autonomous vehicles.

In 2015, legislation was introduced in North Carolina that would have directed the NCDOT to study how to implement autonomous vehicle technology on the roads and highways of North Carolina. Is it now time for North Carolina to analyze its criminal and civil laws and regulations in preparation for the expected widespread introduction of automated vehicles?

Some of the legal issues that courts will be presented with because of connected and automated/autonomous vehicles may include how coverage under North Carolina’s vehicle liability policy will be interpreted when accidents are caused by software in vehicles. Courts may be called upon to address novel issues when analyzing the applicability of North Carolina’s product liability law to accidents caused by software that was downloaded as a software update after the sale of the vehicle. Moreover, products liability and personal injury litigants will face new and likely costly challenges when addressing whether software was the actual and proximate cause of any vehicle accident.

It appears that the Internet of Things and the widespread use of technology in our vehicles will continue to be an integral element of our society. The legal community and lawmakers in North Carolina should take note and prepare to address issues that will arise from the use of highly utilitarian, but sometimes risky, technology in our vehicles.

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by C. Rob Wilson, Hedrick Gardner Kincheloe & Garofalo, LLP

a. The Old Standard - Howerton v. Arai Helmet

Until recently, North Carolina Rule of Evidence 702 stated that “[w]hen "scientific, technical or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert by knowledge, skill, experience, training, or education, may testify thereto in the form of an opinion." In the 2004 case Howerton v. Arai Helmet, the Supreme Court of North Carolina established a three step test to determine the admissibility of expert testimony: (1) whether the expert's proffered method of proof sufficiently is reliable, (2) whether the witness presenting evidence is qualified as an expert, and (3) whether the expert evidence is relevant. N.C.440, 597 S.E.2d 674 (2004). The Howerton court clarified that North Carolina did not adhere to the federal Daubert standard and that North Carolina followed a liberal approach which was "decidedly less mechanistic and rigorous than the ‘exacting standards of reliability’ demanded by the federal approach."

b. Rule 702(a) Amendment

Rule 702(a) was amended, effective October 1, 2011 and applicable to causes of action arising on or after October 1, 2011. The amended Rule 702 (a) added language stating that a qualified witness may only testify as an expert if all of the following apply: (1) the testimony is based upon sufficient facts or data, (2) the testimony is the product of reliable principles and methods, and (3) the witness has applied the principles and methods reliably to the facts of the case. This language brought North Carolina's rule in line with Rule 702 of the Federal Rules of Evidence.

c. State v. McGrady

It did not take long for North Carolina's appellate courts to take up the issue of whether the 2011 amendment to Rule 702 effectively adopted the federal standard set forth in Daubert v. Merrell Dow Pharmaceuticals, 509 U.S. 579, 597, 113 S.Ct. 2786, 2798-99, 125 L.Ed. 469, 485 (1993). The first case to bring this issue in front of the North Carolina courts was State v. McGrady, which arose from defendant McGrady's first-degree murder conviction for the shooting death of his cousin. The central issue at Mr. McGrady's trial was whether he shot his cousin in defense of himself and his son. McGrady attempted to introduce expert testimony on this issue through a "use of force" expert, but the trial court excluded this expert testimony pursuant to the amended Rule 702 and the standard set forth in Daubert. Specifically, the court decided to exclude the expert's testimony regarding reaction times insofar as it did not satisfy the Rule 702 reliability test because the expert could not provide error rates for the reaction time studies on which he relied and because he did not consider certain variables, such as McGrady's physical disability, in reaching his conclusions. The trial resulted in a unanimous jury verdict finding McGrady guilty of first-degree murder and a life sentence.

McGrady appealed to the North Carolina Court of Appeals, arguing that Rule 702 should still be applied as a liberal standard even in light of the 2011 amendment. State v. McGrady, 232 N.C. App. 95, 753 S.E.2d 361 (2014). The Court of Appeals disagreed, holding that the 2011 amendment effectively adopted the standard set forth in Daubert, meaning the trial court did not abuse its discretion in applying the Daubert standard to the use of force expert.

The Supreme Court of North Carolina then allowed McGrady's petition for discretionary review and heard the appeal on March 17, 2015. The Supreme Court issued its opinion on June 10, 2016, affirming the Court of Appeals and holding that the 2011 amendment to Rule 702 did adopt the federal standard for admission of expert witness testimony articulated in Daubert, largely because the General Assembly amended North Carolina's rule in 2011 in virtually the same way that the corresponding federal rule was amended in 2000. -- N.C.--, 787 S.E.2d 1 (2016). In the words of the N.C. Supreme Court, "the General Assembly has made it clear that North Carolina is now a Daubert state." However, the 2011 amendment to Rule 702 did not abrogate all North Carolina precedents interpreting that rule, so long as those precedents do not conflict with the Daubert standard. To that end, interpretation of Rule 702 remains a state law issue and any future federal court decisions will not dictate the meaning of North Carolina's Rule 702.

d. Where do we go from here?

In McGrady, the N.C. Supreme Court underwent an extensive analysis of how the as-amended Rule 702 should be applied. As a baseline, the McGrady court recognized that Daubert interpreted Rule 702 as requiring the trial court to serve a "gatekeeping role," ensuring that expert testimony is reliable before it is admitted by conducting "a preliminary assessment of whether the reasoning or methodology underlying the testimony is scientifically valid and of whether that reasoning or methodology properly can be applied to the facts in issue." The McGrady court then considered the three separate requirements of the amended Rule 702(a):

1. The area of proposed testimony must be based on “scientific, technical or other specialized knowledge” that “will assist the trier of fact to understand the evidence or to determine a fact in issue." To “assist the trier of fact,” expert testimony must provide insight beyond the conclusions that jurors can readily draw from their ordinary experience.

2. The witness must be “qualified as an expert by knowledge, skill, experience, training, or education." The expert witness must be competent in his purported field, although that competence can come from practical experience as much as from academic training, as long as the expert has enough expertise to be in a better position than the trier of fact on the subject.

3. The testimony must meet the three-pronged reliability test set forth in Rule 702(a): (1) The testimony must be based upon sufficient facts or data. (2) The testimony must be the product of reliable principles and methods. (3) The witness must have applied the principles and methods reliably to the facts of the case. The primary focus of the inquiry is on the reliability of the witness's principles and methodology, not on the conclusions that they generate. In the context of scientific testimony, Daubert articulated five factors from a non-exhaustive list that can have a bearing on reliability: (1) “whether a theory or technique ... can be (and has been) tested”; (2) “whether the theory or technique has been subjected to peer review and publication”; (3) the theory or technique's “known or potential rate of error”; (4) “the existence and maintenance of standards controlling the technique's operation”; and (5) whether the theory or technique has achieved “general acceptance” in its field. The trial court is free to consider other factors, and the federal courts have articulated additional reliability factors which may be helpful in certain cases, including (1) whether experts are proposing to testify about matters growing naturally and directly out of research they have conducted independent of the litigation, or whether they have developed their opinions expressly for purposes of testifying, (2) whether the expert has unjustifiably extrapolated from an accepted premise to an unfounded conclusion, (3) whether the expert has adequately accounted for obvious alternative explanations, (4) whether the expert is being as careful as he would be in his regular professional work outside his paid litigation consulting, and (5) whether the field of expertise claimed by the expert is known to reach reliable results for the type of opinion the expert would give. The factors articulated in Howerton may also still be relevant: use of established techniques, expert's professional background in the field, use of visual aids to help the jury evaluate the expert's opinions, and independent research conducted by the expert).

The McGrady court recognized that a similar three-step inquiry was already recognized via Howerton. Although the 2011 amendment to Rule 702 did not change the structure of this inquiry, it did change the level of rigor that North Carolina's courts must use to scrutinize expert testimony before admitting it.

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by Scott S. Addison, Lincoln Derr, PLLC

In June, Judge Robert Ervin granted Directed Verdict in favor of our physician client at the close of Plaintiff’s evidence. Because a Directed Verdict is a white whale in medical malpractice cases (and in many others), we felt the story bore telling. First, it must be said that all counsel involved were highly competent, and the trial was well-fought and contested. The issue boiled down to interpretation of the Continuing Course of Treatment Doctrine, even at the time of trial.

Our case involved an alleged delay in diagnosis of a salivary gland tumor by an otolaryngologist who was also fellowship-trained in head and neck cancer. The patient first presented to a different physician in the same practice with a mass under her chin in May 2009. She returned to that physician for several visits until June 25, 2009. Fifteen months then passed when the patient returned to the practice, this time to see the physician who we represented at trial (the other physician was originally named in the lawsuit but was dismissed due to the statute of repose). The patient visited the practice in September and October 2010; and did not return until January 2012 (despite instructions to do so earlier). The diagnosis of cystic adenocarcinoma of the submandibular gland was made in April 2012.

The lawsuit was filed on May 30, 2014, approximately two years after the cancer was diagnosed. In the Complaint, Plaintiff alleged that Defendant physician was negligent at each of the 2010 visits for not performing an incisional biopsy and in 2012 for not referring her in an expedient fashion. She alleged that even in January 2012, a timely referral would have made a difference in her outcome.

When Plaintiff’s expert was deposed, he was asked if a more expeditious referral in January 2012 would have made any difference in the patient’s staging and outcome. The expert’s testimony was somewhat equivocal, and a jury could have inferred that diagnosis and treatment in January 2012 could have made some amount of difference in her ultimate outcome.

At trial, however, the expert never testified that the physician was negligent during the January 2012 visit or that a different outcome would have been achieved if the patient had been immediately referred. The only criticism related to the care and treatment in September and October 2010.

At the close of Plaintiff’s evidence, we moved for Directed Verdict on the grounds that the lawsuit was filed more than three years after the negligent act(s) giving rise to the cause of action and that the Continuing Course of Treatment Doctrine did not apply to extend the statute of limitations.

As you likely know, the Continuing Course of Treatment Doctrine is “an exception to the rule that ‘the action accrues at the time of the defendant’s negligence.” Webb v. Hardy, 182 N.C. App. 324, 327, 641 S.E.2d 754, 756 (2007) (quoting Locklear v. Lanuti, 176 N.C. App. 380, 384, 626 S.E.2d 711, 715 (2006)).

The doctrine applies to situations where a doctor continues a particular course of treatment over a period of time. The underlying theory of the doctrine is that so long as the doctor/patient relationship continues, the doctor is guilty of malpractice during the entire relationship for not repairing the damage he did and therefore, the cause of action arises at the conclusion of the contractual relationship. In order to benefit from the continuing course of treatment doctrine a plaintiff must show both a continuous relationship and subsequent treatment from that physician. It is insufficient to show the mere continuity of the physician/patient relationship. Rather, the subsequent treatment must be related to the original act, omission or failure to act that gave rise to the original claim.

Whitaker v. Akers, 137 N.C. App. 274, 278, 527 S.E.2d 721, 724-25 (2000)

When the Continuing Course of Treatment Doctrine applies, the statute of limitations is tolled for the period of time between the alleged negligent act “and the ensuing discovery and correction of its consequences”; and “the claim still accrues at the time of the original negligent act or omission.” Horton v. Carolina Medicorp, Inc., 344 N.C. 133, 137, 472 S.E.2d 778, 781 (1996). To take advantage of the Continuing Course of Treatment Doctrine, the patient must allege that the defendant “could have taken further action to remedy the damage occasioned by its original negligence.” Id. at 140, 472 S.E.2d at 782). In addition to the pleading requirements, “there must be some forecast of evidence that the injury occasioned by the original negligence could be remedied by the treating physician.” Webb, 182 N.C. App. at 328, 641 S.E.2d at 757. In Webb, the Court granted summary judgment when it determined that the doctrine did not apply because the plaintiffs had not “forecast any evidence that defendant could have taken any action to remedy the damage occasioned by the alleged original negligence,” despite the fact that the defendant had continued to treat the patient for a year after the injury, and the patient did not learn of the cause of the injury until more than a year after the negligent act. Id.

Taking all of these cases together, the Continuing Course of Treatment Doctrine, has three main elements that must be satisfied in order to apply: 1) a negligent act; 2) a continued physician-patient relationship where the continued care relates to the original care giving rise to the cause of action; and 3) the ability of the defendant at the later encounters to remedy the original negligent care. Failure to establish all three elements defeats the Continuing Course of Treatment Doctrine and the statute of limitation is not tolled. Moreover, and most importantly to our case, the elements of the doctrine must be established at each phase of the litigation: pleadings, summary judgment, and trial.

In our case, Defendant doctor treated the patient in September 2010, October 2010, and January 2012. The patient discovered her injury in April 2012, and she filed suit in May 2014. Therefore, the critical date for purposes of the Continuing Course of Treatment Doctrine was January 2012. If the doctor could have done something to “remedy” his earlier alleged negligence, the doctrine would apply, and the case would have been timely filed. If, however, the die was cast and nothing could have been done in January 2012, then the Continuing Course of Treatment Doctrine would not apply according to Webb and Horton. Plaintiff had satisfied the elements in the initial pleadings and, arguably, to overcome summary judgment. At trial, however, Plaintiff’s sole expert witness did not give any testimony that either (1) the care in January 2012 was negligent or (2) diagnosis and treatment in January 2012 would have changed the patient’s outcome. Therefore, we argued, the Continuing Course of Treatment Doctrine did not apply as a matter of law, and the case was not timely filed.

Judge Ervin heard our arguments on Monday afternoon. He then asked opposing counsel to provide any case law or arguments the following day, and he, too, performed additional research that night. After listening to further argument Tuesday morning, Judge Ervin very carefully and graciously stated: “In every criminal and civil case I preside over, part of my instructions to the jury always is that they are to take the law as I give it to them and not as they think it is or think it should be. Today, I find myself in the same position, where I have to take the law as it is and not as I think it should be. If I require a jury to follow the law as it is, then I have to do the same. I have doubts about the state of the law in Webb and I do not really agree with what it says. However, I have to follow that law. And so I am going to grant the Defendant’s Motion for Directed Verdict.”

The Plaintiff has decided not to appeal the decision. We captured our white whale.

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by Lori Keeton, Lincoln Derr, PLLC

In North Carolina, footage from a law enforcement officer’s body or dashboard cameras is not considered a public record or personnel record according to a recently passed law that goes into effect October 1. North Carolina joins five other states—Florida, Georgia, Illinois, Oregon, and South Carolina— in making this determination.

Prior to the passage of the new law, such footage was often shielded from release to the public because it was considered part of a criminal investigation or personnel file.

Under the new law, anyone captured in police video or audio can make a written request to the head of the custodial law enforcement agency to see the relevant footage. The agency may consider any of the following in deciding whether to grant the request:

• If the person requesting disclosure of the recording is a person authorized to receive disclosure.
• If the recording contains information that is otherwise confidential or exempt from disclosure or release under State or federal law.
• If the release would reveal information regarding a person that is of a highly sensitive personal nature.
• If the release may harm the reputation or jeopardize the safety of a person.
• If the release would create a serious threat to the fair, impartial, and orderly administration of justice.
• If confidentiality is necessary to protect either an active or inactive internal or criminal investigation or potential internal or criminal investigation.

If the request is approved, the applicant will be allowed to view the relevant footage but will not be provided with a copy without a court order. If the request is denied, the applicant can appeal to the superior court for review of the agency’s decision.

Anyone else who wishes to obtain footage must file an action in the superior court in any county where any portion of the recording was made for an order releasing the recording. In determining whether to order the release of all or a portion of the recording, the court must consider the factors set forth above as well as the following:

• Release is necessary to advance a compelling public interest.
• The person requesting release is seeking to obtain evidence to determine legal issues in a current or potential court proceeding.
• There is good cause shown to release all portions of a recording.

North Carolina Governor Pat McCrory says the new law is an attempt to strike a balance between transparency and prudence. The ACLU and others have criticized the law as granting law enforcement agencies such broad discretion that it hinders the very purpose of the cameras (i.e. to build trust and enhance accountability).

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